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a day ago
- Business
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How I'd Build a $1,000 Monthly Income Stream With Just These 2 Stocks
Written by Amy Legate-Wolfe at The Motley Fool Canada Creating a $1,000 monthly income stream with just two TSX stocks may seem like a big ask. But with a little capital and the right mix of reliability and yield, it can be done. The secret is focusing on cash-generating businesses with high distributions and strong fundamentals. For this, I'd lean on Slate Grocery REIT (TSX: and Freehold Royalties (TSX:FRU). These two dividend stocks may operate in very different sectors, but both serve up serious passive income potential. Slate Grocery REIT is in the business of owning U.S. grocery-anchored retail centres. In a market filled with uncertainty, that's not a bad place to be. Grocery stores are considered essential, which means Slate's tenants tend to be stable and long term. The real estate investment trust (REIT) focuses on distributing regular income to unit holders. In Q1 2025, Slate earned US$16.1 million in net income and US$12.3 million of that was attributable to unit holders. Funds from operations (FFO) came in at US$19.6 million, while monthly distributions were maintained at about $1.20 per unit on an annual basis. With a Canadian unit price around $11.20, that works out to a yield close to 8.2%, paid in cash every single month. Its occupancy sits near 94.2%, and Slate collected 99.1% of rents due in the quarter. These are not small figures for a REIT operating in the current environment. Still, risks do exist. Slate carries over $1.2 billion in debt and a leverage ratio just over 52%. Interest rates will keep pressure on refinancing costs and could cap short-term growth. But as long as the rent keeps flowing and grocery stores stay full, the REIT should be able to maintain distributions and slowly grow its property base. Now on to Freehold Royalties. This isn't your average energy company. Freehold doesn't drill wells, it collects royalties. That means it gets paid based on production by third-party operators across Canada and the U.S., without the headaches of managing rigs or hiring crews. In Q1 2025, Freehold posted royalty and other revenue of $91.1 million, up 23% from the year before. FFO hit $68.1 million, translating to $0.42 per share. Dividends paid come to $0.09 monthly or $1.08 annually, good for a yield of about 8.4%. Freehold's production hit a record 16,248 barrels of oil equivalent per day, with 65% of that from higher-value liquids. Its U.S. assets continue to grow, representing 43% of production and 54% of revenue in Q1. This diversification adds stability. Freehold's payout ratio was 65%, and the balance sheet remains healthy with net debt at $272 million and a debt-to-cash-flow ratio of just 1.1 times. That's comfortable for an energy royalty firm. Still, the dividend stock isn't immune to energy prices. A sharp drop in oil could impact future cash flows and put pressure on dividend sustainability, but management appears disciplined and has room to adjust capital plans if needed. So, how would you get to $1,000 a month in income using only these two? It could be split evenly between the two, or weighted depending on your income preferences. Slate's monthly payout provides regular income flow, while Freehold's quarterly dividend could be smoothed out over time. With the two invested in equally, here's how it could shake out. COMPANY RECENT PRICE NUMBER OF SHARES DIVIDEND TOTAL PAYOUT FREQUENCY TOTAL INVESTMENT FRU $42.00 500 $3.84 $1,910.00 Monthly $21,000.00 $14.10 8,842 $1.18 $10,433.56 Monthly $124,672.20 Total — — — $12,343.56 — $145,672.20 There's no such thing as a risk-free yield, especially in today's market. Slate faces refinancing pressures, and Freehold rides the waves of energy prices. But both dividend stocks have proven their ability to generate strong, stable cash flows. And yes, $145,672 is a lot to invest. For investors seeking dependable monthly income without chasing too many stocks, these two could form the foundation of a simple, powerful strategy. The post How I'd Build a $1,000 Monthly Income Stream With Just These 2 Stocks appeared first on The Motley Fool Canada. Before you buy stock in Freehold Royalties Ltd., consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Freehold Royalties Ltd. wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $24,927.94!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 30 percentage points since 2013*. See the Top Stocks * Returns as of 6/23/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Freehold Royalties and Slate Grocery REIT. The Motley Fool has a disclosure policy. 2025
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a day ago
- Business
- Yahoo
AI Is Taking Off in Canada, so Here's the 1 Stock to Buy Now
Written by Amy Legate-Wolfe at The Motley Fool Canada Artificial intelligence (AI) is moving from the sidelines to centre stage in Canada's tech sector. While investors race to find the next big AI winner, most overlook one of the most established players already cashing in on the trend. OpenText (TSX:OTEX) may not be new, but it has the scale, strategy, and structure to grow with AI at its core. For those looking to get in early on Canada's AI evolution, this is the one AI stock worth considering first. OpenText has long been known for enterprise information management. But over the past year, it shifted aggressively into AI. Its new Titanium X platform and Aviator AI tools aim to infuse artificial intelligence into the daily operations of large businesses, everything from process automation to cybersecurity and analytics. Rather than build entirely new markets, OpenText is applying AI to industries and systems that already rely on its software. Still, investors are cautious. In the third quarter of fiscal 2025, OpenText posted total revenue of US$1.3 billion. That's a 13.3% year-over-year drop. But when adjusted for the sale of its AMC business, the decline is closer to 4.5%. Cloud revenue told a different story. It rose 1.8% year over year to US$463 million, marking 17 straight quarters of cloud growth. That's where the AI action lives. More importantly, OpenText continued to churn out strong cash. It generated US$402 million in operating cash flow and US$374 million in free cash flow during the quarter. That's up 4.6% and 7.4%, respectively. It also maintained an adjusted earnings before interest, depreciation and amortization (EBITDA) margin of 31.5%. Even with revenue softness, the AI stock remained highly profitable and capital efficient. From a Canadian-dollar perspective, the business pulled in close to $1.7 billion in quarterly revenue, with roughly $630 million from cloud services. It returned $94 million to shareholders through dividends and another $158 million through share repurchases. At a time when many AI-oriented stocks are unprofitable or speculative, OpenText offers something rare: tangible returns. That doesn't mean the path forward is smooth. The AI stock saw a dip in enterprise cloud bookings, which fell 8.4% year over year. Net income under generally accepted accounting practices (GAAP) was US$93 million, a 5.6% drop. Earnings per share (EPS) also declined slightly. These signs of a slowdown can't be ignored. They reflect softer demand in some business areas and overall market volatility. Still, the AI stock's leadership is staying focused. The final phase of its Business Optimization Plan is underway, which includes workforce reductions, cost control, and reinvestments in key growth areas like AI and security. The plan is expected to generate annual savings between US$490 million and US$550 million by fiscal 2027. About half of those savings should show up by the end of fiscal 2026. Long-term investors know that patience often pays. OpenText has weathered cycles before, expanded through acquisitions, and transformed itself more than once. It's not starting from scratch with AI, it's embedding it into platforms that are already trusted by global banks, governments, manufacturers, and hospitals. For Canadian investors who want meaningful exposure to AI without giving up on earnings, dividends, or scale, OpenText stands out. It's not the flashiest name on the TSX. But it's quietly becoming one of the most important. In a market full of hype, that kind of steady evolution may be just what a smart portfolio needs. The post AI Is Taking Off in Canada, so Here's the 1 Stock to Buy Now appeared first on The Motley Fool Canada. Before you buy stock in OpenText, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and OpenText wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $24,927.94!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 30 percentage points since 2013*. See the Top Stocks * Returns as of 6/23/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. 2025 Sign in to access your portfolio
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2 days ago
- Business
- Yahoo
Why This Tech Stock Could Be the Next Shopify
Written by Amy Legate-Wolfe at The Motley Fool Canada Shopify (TSX:SHOP) is often the gold standard when it comes to Canadian tech success. It went from a little-known e-commerce company to one of the biggest stories on the TSX. So whenever a new name comes up with similar growth potential, it's worth paying attention. That's why (TSXV:TOI) is starting to get noticed. It doesn't have the flash of Shopify, but it has been quietly building something impressive. And for long-term investors, it could be one of the most exciting tech stocks on the market today. Topicus is a software company that focuses on vertical markets. That means it develops and acquires software tailored to specific industries like healthcare, education, and government. It's not trying to be everything to everyone. Instead, it wants to dominate smaller segments by offering exactly what those users need. This model allows it to grow quickly and maintain sticky customer relationships, since these tools are often deeply embedded into a company's day-to-day operations. The tech stock was spun out of Constellation Software in early 2021, and it has inherited some of the same strengths. Like its parent, Topicus is all about acquisition-led growth. It buys up smaller software firms, integrates them into its structure, and uses that foundation to continue growing. This buy-and-build strategy has worked well for Constellation, and Topicus is following a similar path. As of its latest report for the first quarter of 2025, Topicus posted revenue of €506 million, which is about $556 million in Canadian dollars. That was up from €451 million the year before. Net income came in at $37.4 million, with earnings per share (EPS) of $0.47. The tech stock continues to reinvest in operations and acquisitions, which can pressure short-term earnings but support long-term value creation. What makes Topicus exciting is its consistency. Over the past five years, it has grown earnings by 46% per year and revenues by 22% annually. Its return on equity sits at a strong 22.4%, and its profit margin is around 7.3%. Those are healthy numbers for a company in growth mode. These show it isn't just burning cash to expand. It's building a sustainable business with real profits and strong cash flow. The tech stock trades at a high valuation at about 93 times trailing earnings. That might scare off some investors, but it reflects the market's belief in Topicus' growth potential. Its market cap has now reached $22.7 billion, which is impressive for a tech stock still listed on the TSX Venture Exchange. There are risks, of course. The tech stock is highly acquisitive, so it depends on finding good businesses to buy at reasonable prices. Integration risk is real. If one of its acquisitions underperforms or doesn't mesh well with the rest of the business, it could drag down results. Macroeconomic issues in Europe, where many of its customers are located, could also impact demand. Still, Topicus has shown it can handle these challenges. Its focus on vertical markets gives it a defensive edge. Even during tough times, many of its customers can't easily switch to another provider. The software is too deeply ingrained in their daily operations. That helps keep revenue steady and allows Topicus to continue scaling over time. It might not become the next Shopify in terms of market cap, but Topicus has a real chance to become a dominant force in its own space. It's already proving that growth and profitability can go hand in hand. For investors looking for a Canadian tech stock with a long runway ahead, Topicus is a name to watch. And maybe, just maybe, it's the next big thing. The post Why This Tech Stock Could Be the Next Shopify appeared first on The Motley Fool Canada. Before you buy stock in Constellation Software, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Constellation Software wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $24,927.94!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 30 percentage points since 2013*. See the Top Stocks * Returns as of 6/23/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify and The Motley Fool recommends Constellation Software. The Motley Fool has a disclosure policy. 2025 Effettua l'accesso per consultare il tuo portafoglio
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4 days ago
- Business
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This 4.4% Dividend Stock Is Built for Volatile Markets
Written by Amy Legate-Wolfe at The Motley Fool Canada When markets are volatile, some investors panic. Others prepare. And a few find dividend stocks that not only survive the storm but pay you to stay invested through it. Exchange Income (TSX:EIF) is one of those rare stocks built to thrive during the ups and downs. With a strong dividend, diverse revenue, and consistent execution, this dividend stock offers both income and staying power. That makes it a top contender for anyone looking to invest in an uncertain economy. Exchange Income operates in two core segments: aviation and manufacturing. Its aviation business includes regional airlines and emergency medical services, many of which are essential in remote parts of Canada. Its manufacturing segment covers everything from precision engineering to environmental technology. These aren't headline-grabbing industries, but they serve stable demand. That's the kind of consistency you want when the broader market is anything but. The dividend stock's recent earnings show just how resilient it is. In the first quarter of 2025, Exchange Income reported revenue of $668 million, slightly ahead of expectations. Net income came in at $0.28 per share, also beating analyst estimates. These aren't blockbuster results, but they are solid. When so many companies are missing targets, even a modest beat stands out. One of the biggest reasons investors look at Exchange Income is the dividend. As of now, it offers a 4.4% dividend yield. At a share price of about $58, that works out to a monthly payout of $0.22 per share. This dividend is paid like clockwork, with the next one scheduled for mid-July. The dividend stock has a long history of maintaining and increasing its dividend, even through tough periods like the pandemic. That kind of track record adds a level of confidence that's hard to find. For an investor with $5,000, this stock offers a nice mix of income and potential growth. At the current share price, you could buy around 86 shares. That would generate roughly $227.04 in annual income, paid monthly at almost $19! While that might not be life-changing, it's a steady return that can compound over time, especially if you reinvest those dividends. COMPANY RECENT PRICE SHARES DIVIDEND TOTAL PAYOUT FREQUENCY INVESTMENT TOTAL EIF $58.02 86 $2.64 $227.04 Monthly $4,989.72 The financials behind the dividend are also worth noting. While Exchange Income's payout ratio is technically over 100%, that's based on net income, which includes non-cash charges. The dividend stock uses operating cash flow to cover its dividend, which it has managed to do consistently. Its cash flow from operations last year was strong enough to support both the dividend and investments in its fleet and facilities. The dividend stock's market cap is around $3 billion, with a price-to-earnings (P/E) ratio near 24. These numbers are reasonable for a dividend stock with dependable earnings and capital-intensive assets. It also employs close to 8,000 people and owns a wide range of aircraft and manufacturing infrastructure across Canada and the U.S. Of course, no dividend stock is perfect. Exchange Income does carry a fair amount of debt, which is common in the aviation industry. Fuel costs, labour shortages, and economic slowdowns could pressure margins. But the dividend stock has managed these risks well in the past and continues to grow through strategic acquisitions. That's why this 4.4% dividend stock is built for volatile markets. It's not about chasing the next big thing. It's about owning something that keeps performing, rain or shine. For investors who want to stay the course, this is the kind of stock that pays you to be patient. The post This 4.4% Dividend Stock Is Built for Volatile Markets appeared first on The Motley Fool Canada. Before you buy stock in Exchange Income Corporation, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Exchange Income Corporation wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $24,927.94!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 30 percentage points since 2013*. See the Top Stocks * Returns as of 6/23/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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5 days ago
- Business
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This 1 Stock Could be the Future of Crypto and AI in Canada
Written by Amy Legate-Wolfe at The Motley Fool Canada Looking for a Canadian stock sitting right at the crossroads of cryptocurrency and artificial intelligence (AI)? Then Hut 8 (TSX:HUT) is one of the most exciting names to watch. It's a Canadian stock that has evolved from a pure-play Bitcoin miner into something much more ambitious. In a market where both crypto and AI continue to dominate headlines, Hut 8 could be a major player. And with the stock trading below all-time highs, there may be a compelling opportunity here for long-term investors. Hut 8 made waves when it merged with U.S. Bitcoin to form a new cross-border mining and infrastructure firm. Now operating as a more diversified company, it's no longer just about mining Bitcoin. It also manages high-performance computing facilities and is investing heavily in powering AI infrastructure. This dual focus could give Hut 8 a unique edge, especially in a Canadian market where few other public companies are positioned in both crypto and AI. As of writing, the Canadian stock trades at around $24.50 per share, with a market cap of $2.6 billion. While it has had a volatile history, recent moves by the Canadian stock suggest it's aiming to become more stable and strategic. In its most recent quarterly earnings report for Q1 2025, Hut 8 posted revenue of US$21.8 million. However, the company also reported a net loss of US$134 million and an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) loss of US$117.7 million. Those numbers may raise eyebrows, but much of the loss was tied to the company's aggressive expansion strategy. This expansion includes building up its power infrastructure to handle high-performance computing for artificial intelligence workloads. Hut 8 reported a 79% quarter-over-quarter increase in hashrate and a 37% improvement in fleet efficiency. It now controls 1,020 megawatts of power capacity and has identified a future pipeline of over 10,800 megawatts. That kind of power isn't just for mining crypto, it's increasingly being used to support AI model training and large-scale data processing. Hut 8 also made a key financial move by renegotiating its Bitcoin-backed credit facility with Coinbase, increasing it from US$65 million to US$130 million. The deal locks in a fixed 9% interest rate and extends the loan maturity to July 2026. It's a non-dilutive financing option that gives the Canadian stock breathing room and capital to continue scaling. The terms also include a no-rehypothecation clause, meaning the Bitcoin used as collateral is protected. That's a smart, strategic way to access cash without putting shareholders at risk of dilution. Another development worth noting is the company's investment in Highrise AI, a new division focused on graphics processing unit (GPU)-based AI computing. This business segment provides services like GPU-as-a-service to third-party companies building large-scale AI systems. With GPU demand at all-time highs, this could be a significant revenue stream down the line. It's still early, but Hut 8 is laying the groundwork to become a critical part of the digital infrastructure that powers future tech. There's no denying that Hut 8 comes with risk. Its reliance on Bitcoin prices still drives much of the business, and mining is notoriously volatile. But by diversifying into AI compute services and data infrastructure, the Canadian stock is positioning itself to weather downturns better than some of its peers. It's no longer just a speculative crypto play; it's slowly transforming into a Canadian tech infrastructure company with real-world utility. For Canadian investors seeking exposure to these two powerful trends, Hut 8 might just be the Canadian stock to watch. It's still early in its next chapter, but the steps it's taking suggest that this could be one of the most important TSX-listed companies in the digital future. If you believe in both crypto and AI, this is one investment that puts you in the middle of the action. The post This 1 Stock Could be the Future of Crypto and AI in Canada appeared first on The Motley Fool Canada. Before you buy stock in Coinbase Global, consider this: The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Coinbase Global wasn't one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years. Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the 'eBay of Latin America' at the time of our recommendation, you'd have $24,927.94!* Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 30 percentage points since 2013*. See the Top Stocks * Returns as of 6/23/25 More reading Made in Canada: 5 Homegrown Stocks Ready for the 'Buy Local' Revolution [PREMIUM PICKS] Market Volatility Toolkit Best Canadian Stocks to Buy in 2025 Beginner Investors: 4 Top Canadian Stocks to Buy for 2025 5 Years From Now, You'll Probably Wish You Grabbed These Stocks Subscribe to Motley Fool Canada on YouTube Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy. 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
